B-131060, JUNE 7, 1957, 36 COMP. GEN. 803

B-131060, JUNE 7, 1957, 36 COMP. GEN. 803

MILITARY PERSONNEL - RETIRED NAVY OFFICER EMPLOYED AS WHARF BUILDER - DUAL EMPLOYMENT PROHIBITION - SALARY REFUND A NAVY OFFICER WHO IS RETIRED FOR LENGTH OF SERVICE UNDER 34 U.S.C. 410B AND WHO IS EMPLOYED BY THE NAVY DEPARTMENT AS A WHARF BUILDER WITH COMPENSATION FIXED ON AN HOURLY BASIS HOLDS TWO OFFICES WITHIN THE MEANING OF THE PROHIBITION IN 5 U.S.C. 62, AND, INASMUCH AS THE RETIRED PAY AND CIVILIAN COMPENSATION EXCEED THE $2,500 A YEAR LIMITATION, THE SALARY RECEIVED FROM THE CIVILIAN EMPLOYMENT MUST BE REFUNDED. AN INDIVIDUAL WITH PERMANENT ENLISTED STATUS IN THE NAVY WHO IS RETIRED AS AN OFFICER UNDER 34 U.S.C. 401B AND WHO BY REASON OF CIVILIAN EMPLOYMENT IS DETERMINED TO HAVE HELD TWO OFFICES CONTRARY TO THE PROHIBITION IN 5 U.S.C. 62 IS REQUIRED TO REFUND THE NET AMOUNT OF THE CIVILIAN COMPENSATION RECEIVED AFTER MAY 22, 1956, THE DATE OF DECISION OF THE COMPTROLLER GENERAL (35 COMP. GEN. 657) IN WHICH IT WAS HELD THAT ENLISTED MEN RETIRED IN OFFICER STATUS WERE SUBJECT TO THE DUAL OFFICER PROHIBITION.

TO THE SECRETARY OF THE NAVY, JUNE 7, 1957:

FURTHER REFERENCE IS MADE TO LETTER OF MARCH 8, 1957, FROM THE ASSISTANT SECRETARY OF THE NAVY, REQUESTING A DECISION AS TO THE APPLICABILITY OF THE DUAL EMPLOYMENT RESTRICTIONS OF THE ACT OF JULY 31, 1894, 28 STAT. 205, AS AMENDED, 5 U.S.C. 62, IN THE CASE OF LIEUTENANT COMMANDER WILLIS S. HOLLINGWORTH, UNITED STATES NAVY, RETIRED.

IT APPEARS THAT COMMANDER HOLLINGWORTH WAS RETIRED, NOT BY REASON OF PHYSICAL DISABILITY, ON JANUARY 1, 1956, UNDER THE PROVISIONS OF SECTION 6 OF THE ACT OF FEBRUARY 21, 1946, 60, STAT. 27, AS AMENDED BY SECTION 1 OF THE ACT OF AUGUST 9, 1955, 69 STAT. 614. SUCH PROVISIONS ARE CODIFIED AS 34 U.S.C. 410B, ( SUPP. III), AS FOLLOWS:

WHEN ANY OFFICER OF THE REGULAR NAVY OR THE REGULAR MARINE CORPS OR THE RESERVE COMPONENTS THEREOF, INCLUDING ANY MEMBER OF THE NAVAL SERVICE TEMPORARILY APPOINTED TO COMMISSIONED GRADE WHOSE PERMANENT STATUS IS ENLISTED, HAS COMPLETED MORE THAN TWENTY YEARS OF ACTIVE SERVICE IN THE NAVY, MARINE CORPS, ARMY, AIR FORCE, OR COAST GUARD, OR THE RESERVE COMPONENTS THEREOF, INCLUDING ACTIVE DUTY FOR TRAINING, AT LEAST TEN YEARS OF WHICH SHALL HAVE BEEN ACTIVE COMMISSIONED SERVICE, HE MAY AT ANY TIME THEREAFTER, UPON HIS OWN APPLICATION, IN THE DISCRETION OF THE PRESIDENT, BE PLACED UPON THE RETIRED LIST ON THE FIRST DAY OF SUCH MONTH AS THE PRESIDENT MAY DESIGNATE. AS USED IN THIS SECTION "ACTIVE COMMISSIONED SERVICE" INCLUDES ALL ACTIVE SERVICE PERFORMED UNDER A TEMPORARY APPOINTMENT TO A COMMISSIONED GRADE, INCLUDING A COMMISSIONED WARRANT GRADE, BY AN OFFICER WHOSE PERMANENT STATUS IS ENLISTED.

IT FURTHER APPEARS THAT COMMANDER HOLLINGWORTH HAS BEEN PAID RETIRED PAY BEGINNING JANUARY 1, 1956, AT THE RATE OF $317.46 PER MONTH AND THAT FROM APRIL 23, 1956, TO SEPTEMBER 10, 1956, HE WAS EMPLOYED AT THE U.S. NAVAL STATION, TONGUE POINT, ASTORIA, OREGON, AS A WHARF BUILDER WITH COMPENSATION AT THE RATE OF $2.20 PER HOUR.

SECTION 2 OF THE ACT OF JULY 31, 1894, 28 STAT. 205, AS AMENDED, 5 U.S.C. 62, IS AS FOLLOWS:

NO PERSON WHO HOLDS AN OFFICE THE SALARY OR ANNUAL COMPENSATION ATTACHED TO WHICH AMOUNTS TO THE SUM OF TWO THOUSAND FIVE HUNDRED DOLLARS SHALL BE APPOINTED TO OR HOLD ANY OTHER OFFICE TO WHICH COMPENSATION IS ATTACHED UNLESS SPECIALLY AUTHORIZED THERETO BY LAW; BUT THIS SHALL NOT APPLY TO RETIRED OFFICERS OF THE ARMY, NAVY, AIR FORCE, MARINE CORPS, OR COAST GUARD WHENEVER THEY MAY BE ELECTED TO PUBLIC OFFICE OR WHENEVER THE PRESIDENT SHALL APPOINT THEM TO OFFICE BY AND WITH THE ADVICE AND CONSENT OF THE SENATE. RETIRED ENLISTED MEN OF THE ARMY, NAVY, AIR FORCE, MARINE CORPS, OR COAST GUARD RETIRED FOR ANY CAUSE, AND RETIRED OFFICERS OF THE ARMY, NAVY, AIR FORCE, MARINE CORPS, OR COAST GUARD WHO HAVE BEEN RETIRED FOR INJURIES RECEIVED IN BATTLE OR FOR INJURIES OR INCAPACITY INCURRED IN LINE OF DUTY SHALL NOT, WITHIN THE MEANING OF THIS SECTION, BE CONSTRUED TO HOLD OR TO HAVE HELD AN OFFICE DURING SUCH RETIREMENT.

DECISION IS REQUESTED AS TO WHETHER THE FACT THAT COMMANDER HOLLINGWORTH'S EMPLOYMENT WAS ON AN HOURLY RATED BASIS WOULD REMOVE HIM FROM THE RESTRICTIONS OF 5 U.S.C. 62; WHETHER, IF HE MUST REFUND SALARY RECEIVED AS A WHARF BUILDER, SUCH REFUND SHALL BE FOR THE WHOLE PERIOD OF EMPLOYMENT OR FROM MAY 22, 1956; AND WHETHER, IF REFUND IS REQUIRED, IT SHOULD BE THE GROSS AMOUNT EARNED BY HIM OR THE NET AMOUNT RECEIVED AFTER DEDUCTIONS FOR F.I.C.A., WITHHOLDING TAXES, AND INSURANCE.

IT HAS LONG BEEN HELD THAT AN OFFICER OF THE REGULAR MILITARY OR NAVAL SERVICE WHO IS RETIRED FOR LENGTH OF SERVICE HOLDS AN OFFICE WITHIN THE CONTEMPLATION OF THE PROVISIONS OF 5 U.S.C. 62. SEE CITATIONS AT 28 COMP. GEN. 367, 368; 36 COMP. GEN. 309. HENCE, IT SEEMS CLEAR THAT COMMANDER HOLLINGWORTH, AS A RETIRED OFFICER, HELD AN OFFICE WITHIN THE CONTEMPLATION OF THOSE PROVISIONS.

AS TO WHETHER HIS EMPLOYMENT AS A WHARF BUILDER CONSTITUTED THE HOLDING OF AN OFFICE WITHIN THE CONTEMPLATION OF THE ABOVE PROVISIONS, THE FACT THAT SALARY WAS COMPUTED ON AN HOURLY BASIS, RATHER THAN BY THE WEEK, MONTH OR YEAR, WOULD APPEAR TO BE IMMATERIAL. SEE 1 COMP. GEN. 700, 702, IN WHICH IT WAS SAID THAT THE TERM "OFFICE" AS USED IN THE ACT OF JULY 31, 1894, IS "A BROAD GENERAL TERM WHICH HAS BEEN CONSTRUED TO INCLUDE ANY PERSON HOLDING A PLACE OR POSITION UNDER THE GOVERNMENT AND PAID FROM GOVERNMENT FUNDS.' ALSO, SEE 36 COMP. GEN. 309, 310, IN WHICH IT WAS AID:

* * * BROADLY SPEAKING THE TERM "OFFICE" AS USED IN THE 1894 ACT ABOVE HAS BEEN HELD TO COVER ANY POSITION HAVING FEDERAL FUNCTIONS AND DUTIES AND HAVING, ALSO, THE ELEMENTS OF APPOINTMENT, TENURE, DURATION, AND SALARY, RECOGNIZED AS CHARACTERISTIC OF AN OFFICE, AS DISTINGUISHED FROM A MERE CONTRACT FOR THE PERFORMANCE OF PERSONAL SERVICES. * * *

ACCORDINGLY, IT IS CONCLUDED THAT COMMANDER HOLLINGWORTH'S EMPLOYMENT AS A WHARF BUILDER CONSTITUTED THE HOLDING OF AN OFFICE, FORBIDDEN BY THE PROVISIONS OF 5 U.S.C. 62. NOR MAY HE RETAIN SALARY AS A WHARF BUILDER ON THE BASIS OF DE FACTO SERVICE IN THAT CAPACITY, SINCE HIS APPOINTMENT WAS VOID AB INITIO. COMPARE 21 COMP. GEN. 1129. THERE REMAINS THE QUESTION OF HOW MUCH MONEY HE IS REQUIRED TO REFUND.

REFERENCE ALREADY HAS BEEN MADE TO SECTION 1 OF THE ACT OF AUGUST 9, 1955, AMENDING SECTION 6 OF THE ACT OF FEBRUARY 21, 1946. SECTION 2 OF THE ACT OF AUGUST 9, 1955, 69 STAT. 615, 34 U.S.C. 410B NOTE, PROVIDES THAT:

(A) ANY PERSON WHO, ON THE DATE OF ENACTMENT OF THIS ACT, IS A MEMBER OF THE FLEET RESERVE OR FLEET MARINE CORPS RESERVE AND WHO PRIOR TO HIS TRANSFER THERETO---

(1) WAS SERVING UNDER A TEMPORARY APPOINTMENT IN A COMMISSIONED GRADE, AND

(2) HAD COMPLETED MORE THAN TWENTY YEARS OF ACTIVE SERVICE IN THE NAVY, MARINE CORPS, ARMY, AIR FORCE, OR COAST GUARD, OR THE RESERVE COMPONENTS THEREOF, INCLUDING ACTIVE DUTY FOR TRAINING, AT LEAST TEN YEARS OF WHICH WAS ACTIVE COMMISSIONED SERVICE,

MAY, IN THE DISCRETION OF THE PRESIDENT, BE PLACED ON THE RETIRED LIST WITH THE HIGHEST RANK IN WHICH HE SERVED SATISFACTORILY BEFORE HIS TRANSFER TO THE FLEET RESERVE OR FLEET MARINE CORPS RESERVE, IF APPLICATION THEREFOR IS MADE WITHIN NINETY DAYS AFTER THE ENACTMENT OF THIS ACT.

(B) ANY PERSON TRANSFERRED TO THE RETIRED LIST UNDER SUBSECTION (A) IS ENTITLED TO RETIRED PAY AT THE RATE OF 2 1/2 PERCENTUM OF THE ACTIVE DUTY PAY, WITH LONGEVITY CREDIT, OF THE GRADE IN WHICH HE IS PLACED ON THE RETIRED LIST, MULTIPLIED BY THE NUMBER OF YEARS OF SERVICE FOR WHICH ENTITLED TO CREDIT IN THE COMPUTATION OF HIS ACTIVE DUTY PAY AT THE TIME OF TRANSFER TO THE FLEET RESERVE OR FLEET MARINE CORPS RESERVE, NOT TO EXCEED A TOTAL OF 75 PERCENTUM OF THE ACTIVE DUTY PAY OF THAT RANK. FRACTIONAL YEAR OF SIX MONTHS OR MORE SHALL BE CONSIDERED A FULL YEAR IN COMPUTING THE NUMBER OF YEARS OF SERVICE BY WHICH THE RATE OF 2 1/2 PERCENTUM IS MULTIPLIED.

IN DECISION OF MAY 22, 1956, 35 COMP. GEN. 657, IT WAS HELD THAT PERSONS PLACED ON THE RETIRED LIST PURSUANT TO SECTION 2 (A) OF THE ACT OF AUGUST 9, 1955, WERE SUBJECT TO 5 U.S.C. 62, SINCE THEY WERE RETIRED AS OFFICERS. THE DEPARTMENT OF THE NAVY SEEMS TO HAVE CONCLUDED, CORRECTLY, THAT A LIKE INTERPRETATION OF THE EFFECT OF 5 U.S.C. 62 IS REQUIRED IN THE CASE OF PERSONS RETIRED, AS WAS COMMANDER HOLLINGWORTH, UNDER THE PROVISIONS OF 34 U.S.C. 410B.

IN DECISION OF OCTOBER 9, 1956, 36 COMP. GEN. 288, WE HELD THAT, SINCE OUR DECISIONS PRIOR TO MAY 22, 1956, MIGHT HAVE GIVEN SOME GROUND FOR THE BELIEF THAT THE PROVISIONS OF 5 U.S.C. 62 DID NOT APPLY IN THE CASE OF PERSONS RETIRED UNDER SECTION 2 (A) OF THE ACT OF AUGUST 9, 1955, SUCH PERSONS WERE NOT REQUIRED TO MAKE REFUND OF DUAL COMPENSATION IMPROPERLY RECEIVED FOR PERIODS PRIOR TO MAY 23, 1956. WE THINK THAT THE PRINCIPLE OF THAT DECISION IS EQUALLY APPLICABLE TO PERSONS IN COMMANDER HOLLINGWORTH'S SITUATION, ASSUMING, OF COURSE, THAT AT THE TIME OF HIS RETIREMENT HE WAS A "MEMBER OF THE NAVAL SERVICE TEMPORARILY APPOINTED TO COMMISSIONED GRADE WHOSE PERMANENT STATUS IS ENLISTED.' HENCE, IF OUR ASSUMPTION RESPECTING HIS STATUS AT TIME OF RETIREMENT IS CORRECT, HE WILL NOT BE REQUIRED TO REFUND COMPENSATION RECEIVED AS A WHARF BUILDER FOR ANY PERIOD PRIOR TO MAY 23, 1956.

COMMANDER HOLLINGWORTH SHOULD REFUND THE NET AGGREGATE AMOUNT RECEIVED BY HIM AS SALARY AS A WHARF BUILDER FOR THE PERIOD MAY 23 TO SEPTEMBER 10, 1956. THE APPROPRIATE AGENCIES SHOULD BE NOTIFIED OF THIS DECISION AND REQUESTED TO TRANSFER TO THE DEPARTMENT OF THE NAVY THE AMOUNTS WITHHELD FROM COMMANDER HOLLINGWORTH'S SALARY AS A WHARF BUILDER FROM MAY 23 TO SEPTEMBER 10, 1956, AS DEDUCTIONS FOR WITHHOLDING TAXES, F.I.C.A., AND INSURANCE. COMPARE 35 COMP. GEN. 216.